Technical Bits: Orient Electric gives trendline breakout

The stock of Orient Electric has given downward sloping trendline breakout on weekly scale. The breakout was supported by relatively higher volumes. Additionally, the stock formed a sizeable bullish candle on breakout week, which adds strength to the breakout. With this trendline breakout, the daily ADX, which shows the strength of the trend, turned upside and moved above the -DI and +DI.

The major trend of the stock is bullish as it is trading above its weekly pivot and above its long-term and short-term moving averages, i.e. 20-day, 50-day, 100-day and 200-day EMAs. The 14-period daily RSI is currently quoting at 67.20 and it is in bullish zone. The daily and weekly stochastic oscillator is also suggesting some bullish strength as %K is above the %D. The MACD is trading above the zero line for the past six trading sessions. The histogram is suggesting that the momentum is picking up.

Going ahead, the stock has immediate support in the zone of Rs. 157-155 as the 50-day EMA and 100-day EMA is placed in that region, while the major support is placed in the zone of Rs. 150-147 as it is the confluence of 200-day EMA and the upward sloping trendline support. On the higher side, any sustainable move above the level of Rs. 170 is likely to open up gates for further rally towards the levels of Rs. 177, followed by Rs. 185.

On Friday, the stock of Orient Electric closed at Rs. 169.55 per share, surged by 5.37 per cent. The stock opened at Rs. 162 per share and hit an intraday high of Rs. 169.95 and a low of Rs. 160.95 per share on NSE.